Semi-annual Report(2nd Fiscal Period: October 1, 2017 to June 30, 2018)
 Financial Report ･････････････････････････････････････････ 1
 Risk Factors ･････････････････････････････････････････････ 9 Financial Statements ･････････････････････････････････････ F-1

Financial Report
1. Associated Corporations of Canadian Solar Infrastructure Fund
Disclosure is omitted because there have been no significant changes from the description in the latest
securities report (submitted on August 14, 2018).
2. Management Policy and Management Status(1) Management Policy
Disclosure is omitted because there have been no significant changes from the description in the latest securities
report (submitted on August 14, 2018).
(2) Management Status
I. Overview of the Fiscal Period under Review
a. Brief History of Canadian Solar Infrastructure Fund
Canadian Solar Infrastructure Fund, Inc. (hereinafter referred to as “CSIF”) was established on May 18, 2017 withmoney invested of 150 million yen (1,500 units) by Canadian Solar Asset Management K.K. (hereafter referred toas the “Asset Manager”) as the founder under the Act on Investment Trusts and Investment Corporations (Act No.
198 of 1951 including subsequent amendments; hereinafter referred to as the “Investment Trusts Act”).
Registration with the Kanto Local Finance Bureau was completed on June 9, 2017 (registration number 127, filedwith the Director of the Kanto Local Finance Bureau).
CSIF issued additional investment units (177,800 units) through a public offering on October 27, 2017 and listed
its investment units on the Tokyo Stock Exchange Inc.’s (hereinafter referred to as the “Tokyo Stock Exchange”)
Infrastructure Fund Market on October 30, 2017 (security code: 9284).
On November 28, 2017, CSIF issued new investment units (2,890 units) through third-party allotment. As a result,
the total units in issue as of June 30, 2018 was 182,190 units.
b. Investment Environment
During the fiscal period under review, the Japanese economy recovered at a moderate pace, mainly attributable
to a gradual increase in capital expenditure and improvements in corporate earnings and the employment
situation. Going forward, the economy is expected to continue its mild recovery trend, backed by continued
improvement in the employment situation and personal income. Nonetheless, attention needs to be paid to theimpact of monetary policy decisions in the US, uncertainties in other parts of the global economy and fluctuations
in financial and capital markets.
Reflecting changes in the monetary policy in the US and other factors, the stock market in Japan has been
experiencing instability after exiting its upward trend at the beginning of the year. Meanwhile, notwithstanding
the negative impact of the stock market, the Infrastructure Fund Market has remained relatively defensive.
In the environment surrounding the renewable energy power generation facilities (those stipulated in Article 2,
Paragraph 3 of the Act on Special Measures Concerning Procurement of Electricity from Renewable Energy
Sources by Electricity Utilities (Act No. 108 of 2011 including subsequent amendments. Hereinafter referred to as
the “Act on Renewal Energy Special Measures”) (excluding those that fall under real estate). Hereinafter referred
to as “renewable energy power generation facilities”) held by CSIF, improvement in the self-sufficiency rate ofprimary energy and a reduction of greenhouse gas emissions remain as challenges. In Japan’s energy planannounced by the Ministry of Economy, Trade and Industry in July 2015, the energy mix (energy supply demand
structure) for the target year 2030 under the long-term energy supply and demand outlook was revised and reformulated from a long-term perspective in light of the Fourth Strategic Energy Plan, under which the use ofrenewable energy was introduced (22-24% in power source composition). The Fifth Strategic Energy Planapproved by the Cabinet as of July 3, 2018 presents measures for the use of renewable energy as the major
power source, including a reduction in the procurement cost of renewable energy, overcoming power grid2constraints and securing load following capacity. The new plan also set out Japan’s new energy scenario towards
2050 with the aim to achieve economic efficiency, decarbonization and the use of renewable energy as the major
power source.
c. Management Performance
During the fiscal period under review, CSIF acquired 13 photovoltaic power generation facilities, etc. (Note 3) on
October 31, 2017 (a total panel output (Note 1) of 72.7MW and a total acquisition price (Note 2) of ¥30,438
million) using net proceeds from the issuance of new investment units through public offering as well as
borrowings in accordance with the basic asset management policy, etc. set forth in its Articles of Incorporation,and commenced substantive investment operations. In addition, two photovoltaic power generation facilities, etc.
(a total panel output of 2.6MW and a total acquisition price of ¥992 million) were acquired on February 1, 2018using borrowings with the aim of improving CSIF’s portfolio and expanding external growth. As a result, CSIF
possessed and managed a portfolio consisting of 15 photovoltaic power generation facilities, etc. (a total panel
output of 75.3MW and a total price (Note 4) of ¥35,963 million) as of the end of the fiscal period under review.
(Note 1) “Panel output” shall mean output calculated by multiplying rated output per solar cell module (meaning
the maximum output stated in specifications of solar cell module) used in each solar energy facility by the total
number of panels. The same shall apply hereunder.
(Note 2) “Acquisition price” shall mean the sale and purchase price (excluding outsourcing service fees and otheracquisition expenses related to the acquisition of assets, property-related taxes, urban planning taxes,
consumption taxes and other fees and charges) described in the sale and purchase agreement pertaining to each
asset acquired. It shall be rounded down to the nearest one million yen. The same shall apply hereunder.
(Note 3) “Renewable energy power generation facilities, etc.” shall collectively refer to renewable energy power
generation facilities as well as real estate and the right of lease (including the right of sublease) of real estate or
the surface right (hereinafter referred to as “Site, etc.”) to install, maintain and operate the renewable energy
power generation facilities. In addition, “photovoltaic power generation facilities, etc.” shall collectively refer tophotovoltaic power generation facilities (of renewable energy power generation facilities, photovoltaic power
generation facilities shall specifically refer to renewable energy power generation facilities that generate powerusing solar light as the source of energy; the same shall apply hereunder) as well as real estate and the right oflease (including the right of sublease) of real estate or the surface right to install, maintain and operate
photovoltaic power generation facilities. The same shall apply hereunder.
(Note 4) “Price” shall mean intermediate value calculated by CSIF using the appraisal value of each power plant asof June 30, 2018 stated in valuation reports obtained from PricewaterhouseCoopers Sustainability LLC. The same
shall apply hereunder.
d. Overview of Financing
In the fiscal period under review, CSIF raised ¥17,165 million through public offering in October 2017 and thirdparty allotment of additionally issued investment units (180,690 units) in November 2017. In addition, a total of¥18,640 million was borrowed in October 2017 and February 2018. On the other hand, a contractual repayment
was made at the end of the fiscal period under review, and the amount of borrowings as of the end of the fiscal
period under review came to ¥18,103 million. Consequently, the ratio of interest-bearing debt to total assets(ratio of interest-bearing debt to total assets at the end of fiscal period) was 50.5%.
e. Overview of Business Performance and Distributions
As a result of the management described above, the business performance in the fiscal period under review
recorded operating revenue of ¥2,023 million, operating income of ¥845 million, ordinary income of ¥331 million
and net income of ¥330 million.
Pursuant to the cash distribution policy set forth in Article 47, Paragraph 1 of its Articles of Incorporation, CSIF
shall distribute an amount in excess of the amount equivalent to 90% of its distributable earnings as defined in3Article 67-15 of the Act on Special Measures Concerning Taxation. In addition, distributions in excess of earnings
are calculated on the premise that such distributions will generally be made in accordance with the cash
distribution policy prescribed in CSIF’s Articles of Incorporation and the Asset Manager’s asset management
guidelines formulated as part of its internal regulations.
CSIF intends to make cash distributions to its unitholders for each fiscal period from free cash flow (hereinafterreferred to as “FCF”) generated by its renewable energy power generation facilities, in amounts determined in
the following manner. The amount available for distribution shall be calculated by multiplying FCF, that is net cash
flow (hereinafter referred to as “NCF”; CSIF shall incorporate the total amount of NCF remaining after deducting
distributions for the preceding fiscal periods in calculating NCF) to be vested to equity investors after deducting
FCF payable to debt investors, by a certain ratio (hereinafter referred to as “payout ratio”; The payout ratio forthe 2nd fiscal period is 45.9%.) determined by CSIF in light of the amount of NCF for each fiscal period.
In addition to a cash distribution within the range of profit, CSIF intends to make distributions in excess ofearnings for each fiscal period on a continuous basis in order to realize this policy.
In developing its performance forecast (including any revisions thereof) for each fiscal period, in the case where
NCF calculated from actual energy output in a fiscal period (hereinafter referred to as “actual NCF”; CSIF shallincorporate the total amount of NCF remaining after deducting distributions for the preceding fiscal periods incalculating actual NCF) exceeds NCF projected for the fiscal period (hereinafter referred to as “projected NCF”;
CSIF shall incorporate the total amount of NCF remaining after deducting distributions for the preceding fiscal
periods in calculating projected NCF) on the basis of an energy output value projected by professional specialists(P50) which forms the foundation for the calculation of rents with regard to the renewable energy power
generation facilities, CSIF intends to limit the cash distribution to the amount of projected NCF multiplied by thepayout ratio for said fiscal period.
On the other hand, in the case where actual NCF is equal to or below projected NCF, CSIF intends to make a cash
distribution for the fiscal period at the amount of actual NCF multiplied by the payout ratio.
Based on the above policy, CSIF determined to make a distribution for the fiscal period under review of¥428,146,500, equivalent to 45.9% of projected NCF for the period (¥932,781,045). As a result, distribution inexcess of earnings is ¥147,209,520, after deducting dividends for the period of ¥280,936,980.
Dividend per investment unit is ¥2,350 for the fiscal period under review.

4Reference
1. Conditions of Investment
as of June. 30.2018
Type of asset

Total Asset-UnderManagement（AUM)(‘000yen)(2)

Region (1)Hokkaido/Tohoku% of total AUM(3)

206,072

0.6

Kanto

2,174,805

6.1

Tokai

468,581

1.3

Chugoku/Shikoku

627,761

1.8

23,267,183

64.9

26,744,405

74.6

Hokkaido/Tohoku

48,954

0.1

Kanto

519,733

1.5

Tokai

-

-

123,6440.3

3,184,222

8.9

3,876,554

10.8

-

-

Kanto

59,1970.2

Tokai39,9530.1--

390,4501.1

489,601

1.4

255,026

0.7

Kanto

2,753,736

7.7

Tokai

508,535

1.4

Chugoku/Shikoku

751,406

2.1

26,841,857

74.9

Subtotal

31,110,561

86.8

Solar energy facility etc. total

31,110,561

86.8

Saving/other assets

4,730,707

13.2

Asset total (2)35,841,269

100.0

Solar energy facility

KyushuSubtotal

Land

Chugoku/Shikoku
KyushuSubtotal
Hokkaido/Tohoku

Land lease

Chugoku/Shikoku
KyushuSubtotal
Hokkaido/Tohoku

Solar energy facility etc.

KyushuAmount (‘000 yen)

% of total asset (3)Debt Total

18,244,671

50.9

Net asset Total

17,596,597

49.1

5

(1) “Hokkaido and Tohoku” denote Hokkaido, Aomori-ken, Iwate-ken, Akita-ken, Miyagi-ken, Fukushima-ken and Yamagata-ken.
“Kanto and Koshin-etsu” denote Ibaraki-ken, Tochigi-ken, Gunma-ken, Tokyo-to, Kanagawa-ken, Saitama-ken, Chiba-ken
Yamanashi-ken, Nagano-ken and Niigata-ken. “Tokai and Hokuriku” denote Shizuoka-ken, Aichi-ken, Gifu-ken, Mie-ken,
Toyama-ken, Ishikawa-ken and Fukui-ken. “Kinki” denotes Shiga-ken, Kyoto-fu, Osaka-fu, Nara-ken, Wakayama-ken and Hyogoken. “Chugoku and Shikoku” denote Okayama-ken, Hiroshima-ken, Yamaguchi-ken, Tottori-ken, Shimane-ken, Kagawa-ken,
Kochi-ken, Tokushima-ken and Ehime-ken. “Kyushu and Okinawa” denote Fukuoka-ken, Oita-ken, Miyazaki-ken, Kagoshima-ken,
Kumamoto-ken, Nagasaki-ken, Saga-ken and Okinawa-ken.
(2) The amount posted on the balance sheet as of June 30, 2018. The saving/Other assets includes construction in progress(1,944,000yen) .
(3) The figures have been rounded to the second decimal place.

2. Investment Assets
Investment Securities
Not Applicable
Investment Properties
Not Applicable
Major Investment Assets
The following table provides summary information for the CSIF current 15 solar energy projects as of June 30,
2018.

Asset＃ Category

S-01
S-02
S-03
S-04
S-05
S-06
S-07
S-08
S-09

Project nameLocation

Solar Plant CS Shibushi-shi
etc.
Power Plant
Solar Plant CS Isa-shi Power
etc.
Plant
Solar Plant CS
Kasama-shi
etc.
Power Plant
Solar Plant CS Isa-shi Dai-nietc.
Power Plant
Solar Plant CS
Yusui-choetc.
Power Plant
Solar Plant CS Isa-shi Dai-san
etc.
Power Plant
Solar Plant CS
Kasama-shi
etc.
Dai-niPower
Plant
Solar Plant CS
Hiji-machi
etc.
Power Plant
Solar Plant CS Ashikita-machi
etc.
Power Plant

Shibushi-shi,
KagoshimaIsa-shi,Kagoshima
Kasama-shi,
IbarakiIsa-shi,Kagoshima
Aira-gun,KagoshimaIsa-shi,Kagoshima
Kasama-shi,
IbarakiHayami-gun,
Oita
Ashikita-gun,
Kumamoto

6

Site Area(㎡)

PPA
purchase
price(yen/kwh)

19,86140

22,22340

42,666(1)

40

31,81836

25,27436

40,73640

53,27540

30,24636

45,74040

Certification
FIT term end
Date
2/26/2013

9/16/2034

2/26/2013

6/8/2035

1/25/2013

6/25/2035

10/2/2013

6/28/2035

3/14/2014

8/20/2035

2/26/2013

9/15/2035

1/25/2013

9/23/2035

7/16/201310/12/2035

2/26/201312/10/2035

S-10

S-11
S-12
S-13
S-14
S-15

Solar Plant CS
etc.
Minamishimabar
a-shi Power Plant(East)/CS
Minamishimabar
a-shi Power Plant(West)
Solar Plant CS Minano-machi
etc.
Power Plant
Solar Plant CS Kannami-cho
etc.
Power Plant
Solar Plant CS Mashiki-machi
etc.
Power Plant
Solar Plant CS Koriyama-shi
etc.
Power Plan
Solar Plant CS Tsuyama-shi
etc.
Power Plant

Minamishimaba
ra-shi, Nagasaki
56,066Chichibu-gun,
SaitamaTagata-gun,Shizuoka
Kamimashikigun, Kumamoto
Koriyama-shi,
Fukushima
Tsuyama-shi,
Okayama

40

44,90432

41,33936

638,552（2）
30,376(1)

36
32

31,05932

2/26/201312/24/2035

2/26/201312/11/2014

1/28/2036
12/6/2036

3/31/2014

3/2/2037

10/24/2013

6/1/2037

2/27/2015

9/15/2036(1) Site area for the portion of the solar energy plants land under ownership is shown, and excludes the portion of the land where
we hold an easement.
(2) Site area for the portion of the solar energy plants and high-voltage land under ownership is shown, and excludes the portion of
the land where we hold an easement.

Asset
#

Project name

Certified
Operator

Fiscal period
Acquisition
end
Price
PPA company
Valuation(million yen)(million yen)
(１)
(2)

CS Shibushi-shi
KyushuTida Power 06
Power Plant
Electric Power
G.K
Co., Inc540

CS Isa-shi Power Tida Power 05
Kyushu
Plant
G.K.
S-02
Electric Power
Co., Inc

372

CS Kasama-shi Castilla Clean TEPCO Energy
Power Plant
Energies
Partner,
Tsukuba K.K. Incorporated

907

CS Isa-shi Dai-ni
KyushuTida Power 10
Power Plant
S-04
Electric Power
G.K.
Co., Inc

778

S-01

S-03

S-05

S-06

609

Appraisal value of Fiscal period
solar plants
end Book(million yen)(3)
Value(upper：solar (million yen)energy facility)(4)(lower：land）
476

538

133
404

381

370

22
1,097

819

904

278
837

797

769

40

CS Yusui-cho
KyushuTida Power 09
Power Plant
Electric Power
G.K.
Co., Inc
CS Isa-shi Dai- Tida Power 02
Kyushusan
G.K.
Electric PowerPower Plant
Co., Inc

7

670

721

949

1,027

688
33
968
59

663

938

S-07

S-08

CS Kasama-shi Castilla Clean
TEPCO Energy
Dai-ni Power
Energies
Partner,
Plant
Tsukuba2 K.K.
Incorporated

850

CS Hiji-machi
KyushuPower Plan Tida Power 25 Electric Power
G.K.
Co., Inc

1,029

853
907

835
54

1,105

1,061

1,017

44

CS Ashikita- Tida Power 07
KyushuS-09
machi Power
G.K.
Electric Power
Plant
Co., Inc
CS Minamishim Tida Power 07
abara-shi Power
G.K.
KyushuPlant(East)/CS
S-10
Electric Power
Minamishimaba
Co., Incra-shiPower
Plant(West)
CS MinanoTEPCO Energy
machi Power Univergy 06
S-11
Partner,
Plant
G.K.
Incorporated

1,733

CS Kannami-cho
Clean
Power
Plant
S-12
Sangonera
K.K.

514

989

1,079

1,038
41

977

1,872
1,954

1,714
81
912

1,018

1,173

1,013
261

TEPCO Energy
Partner,
Incorporated

585

544

508

40

CS MashikiKyushu
Tida Power 22
S-13
machi PowerElectric Power
G.K.
Plant
Co., Inc.
CS Koriyama-shi
TohokuClean Guadal
S-14
Power Plant
Electric Power
Quivir K.K.
Co., Inc.
CS Tsuyama-shi
The Chugoku
Univergy 12
S-15
Power Plant
Electric Power
G.K.
Co., Inc

20,084

23,391

246

269

20,271
3,120
221
47

19,852

255

679

Total

746

802

31,43135,963

123
31,583

4,379

751

31,110(1) Acquisition price is based on acquisition price as described in the purchase agreements (excluding acquisition expenses related tothe payment of outsourcing service fees, property-related taxes, taxes on depreciable assets, urban planning taxes, consumption
taxes and other fees).
(2) Median project valuation report amount is the median amount that we calculated based on the estimated values as of 30. June,2018 provided to us by PricewaterhouseCoopers Sustainability LLC in its project valuation report. Based on the appraised value inthe range stated in the valuation report with the date of the value opinion on June 30, 2018, which was obtained fromPricewaterhouseCoopers Sustainability LLC, the Investment Corporation calculated the total sum of the intermediate values
according to Article 41, paragraph 1 of the CSIF's Articles of Incorporation, and the said sum is used in the statement.
(3) On the upper row of the appraisal value of solar plants, an assumed appraisal value of solar energy projects that is obtained bydeducting the real estate appraisal value calculated by Daiwa Real Estate Appraisal Co., Ltd. from the appraised value at the end of
the period in (Note 2) above is stated, and on the lower row, an amount stated in the real estate appraisal report prepared by Daiwa
Real Estate Appraisal Co., Ltd. is stated. Real estate includes its superficies right.
(4) Fiscal period end book value is the book value of solar energy as of June 30, 2018.

8

Risk Factors
An investment in our units involves significant risks. The principal risks with respect to investment
in Canadian Solar Infrastructure Fund, Inc. (“CSIF”) are as follows.
The principal risks with respect to investment in CSIF are as follows: CSIF has limited operating history and limited financial data regarding its portfolio and results ofoperations, making it difficult to fully evaluate CSIF’s prospects and future financial results;
 the Asset Manager has limited experience in operating an infrastructure fund; CSIF may not close all or any of its anticipated acquisitions of solar energy projects;
 the limited operating history of many of the solar energy projects in CSIF’s portfolio may make it
difficult to fully evaluate CSIF’s prospects and future financial results;
 CSIF may not complete the expected debt financing, in which case CSIF may not be able to acquire
some or all of the projects CSIF anticipates acquiring, or CSIF may be forced to accept alternative
financing with less advantageous terms;
 increases in prevailing market interest rates may increase CSIF’s interest expense and may result ina decline in the market price of CSIF’s units;
 CSIF’s portfolio consists exclusively of solar energy projects and its rental revenues are linked
partially to revenues from the sale of electricity while its operating expenses are largely fixed; fluctuations in our revenues and expenses may decrease CSIF’s distributions to its unitholders andreduce the market value of CSIF’s units;
 the amount of electricity generated by the solar energy projects in CSIF’s portfolio is difficult toforecast and may be lower than expected;
 renewable energy projects are subject to unique risks of defects, breakdowns and accidents which
may adversely affect CSIF’s financial condition and results of operation;
 inability to secure rights to land for electricity transmission lines in the locations CSIF require may
result in incurring additional expenses in acquiring such rights in alternative locations, or CSIF may
be unable to transmit the electricity generated by its solar energy projects to purchasers;
 the Japanese government may change or abolish Japan’s feed-in-tariff (“FIT”) scheme for renewableenergy; the Japanese government may take regulatory action to decrease the FIT purchase price andpurchase period for electricity under Japan’s FIT scheme;
 the number of purchasers of utility-scale quantities of electricity in Japan are limited, which exposes
CSIF and its solar energy projects to additional risks; CSIF’s reliance on Canadian Solar Projects K.K. as the operator of all solar energy projects in its
portfolio could have a material adverse effect on CSIF’s business; most solar energy projects in CSIF’s portfolio may be concentrated in the Kyushu and Okinawa
areas; CSIF may suffer large losses if any of its properties incurs damage from natural or man-madedisasters;
 CSIF’s reliance on Canadian Solar Projects K.K. and its related entities and Canadian Solar O&M
Japan K.K. could have a material adverse effect on CSIF’s business;
 CSIF’s dependence on the performance of CSIF’s executive director, supervisory directors and theoperator and service providers to which CSIF is required to assign various key functions could have amaterial adverse effect on CSIF’s business; and CSIF’s failure to satisfy a complex series of requirements pursuant to Japanese tax regulations would
disqualify CSIF from certain taxation benefits and significantly reduce its cash distributions to its
unitholders.
In addition, CSIF is subject to the following risks:
 risks related to defective title, defective foundations or other geological defects in the land on which
the solar energy projects in the portfolio are located;

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risks related to the lack of maintenance or damage to the electricity transmission facilities used by
the electricity business operators, CSIF’s lessees, to sell the electricity from the solar energy
projects;
risks related to involvement in disputes with neighboring residents of the solar energy projects;
risks related to revocation by the Japanese government of the certification of a renewable energy
business plan;risks related to termination or revision of power purchase agreements and interconnection
agreements;
risks related to requirement to reduce electricity output;
risks related to erosion by inflation of purchasing power of amounts paid per kWH for electricity
from renewable sources;
risks related to the sale of electricity after the expiration of the purchase period under the FIT;
risks related to electricity business operators, CSIF’s lessees;
risks related to electric utility operators;
risks related to increase in value of renewable energy projects and competition in acquiring solar
energy projects;
risks related to illiquidity in the market for solar energy projects;
risks related to investments in non-solar renewable energy projects;
the past experience of Canadian Solar Projects K.K. and its related entities and Canadian Solar O&M
Japan K.K. in the Japanese solar energy market is not an indicator or guarantee of CSIF’s future
results;risks related to the sponsor support agreement between CSIF and the Asset Manager and Canadian
Solar Projects K.K.,
risks related to reclaimed land;risks related to artificially developed land;risks related to unexpected expenses for repair or maintenance of the projects;
risks related to laws and regulations applicable to land underlying the projects;
risks related to liabilities for any unforeseen loss, damage or injury suffered by a third party at the
projects;
risks related to CSIF’s relatively small asset size;
risks related to entering into forward commitment contracts;
risks related to relying on expert report for land appraisals, project valuation report, energy output
projections and seismic reports as well as industry and market report;risks related to the presence of hazardous or toxic substances in the projects, or the failure toproperly remediate such substances;risks related to the strict environmental liabilities for the projects;
risks related to inability to obtain financing for future acquisitions, or any restrictions on CSIF’s
activities under its financing arrangements;
risks related to restrictive covenants under debt financing arrangement;risks related to CSIF’s policy to make distributions to its unitholders in excess of CSIF’s retained
earnings;
risks related to repurchasing CSIF’s units;risks related to a high loan-to-value, or LTV, ratio;risks related to suffering impairment losses relating to the projects;
risks related to future borrowings or issuances of investment corporation bonds;
risks related to downgrading of credit rating;risks related to adverse conditions in the Japanese economy;risks related to technological advances and innovations;risks related to potential conflict of interest between CSIF and certain Canadian Solar Projects K.K.
related companies and Canadian Solar O&M Japan K.K., including the AIFM;
risks related to dependence on the efforts of the AIFM’s key personnel ;

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risks related to lessees’ default as a result of financial difficulty or insolvency;
risks related to O&M service providers;risks related to unitholder’s limited control over changes in CSIF’s investment policies;
risks related to the tight supervision by the regulatory authorities;risks related to the tax authorities’ disagreement with the AIFM’s interpretations of the Japanese
tax laws and regulations;risks related to changes in Japanese tax laws;
CSIF’s ownership rights in some of its projects may be declared invalid or limited;risks related to loss of rights in a property due to the recharacterization of purchase of the property
as a secured filing;risks related to holding the underlying land for the solar energy projects in the form of a leaseholdinterest or surface rights;
risks related to holding the property in the form of co-ownership interests (kyōyū-mochibun);risks related to tax increase and amendment of the applicable administrative laws and local
ordinances;risks related to the rights of unitholders in an infrastructure fund;risks related to cost of complying with regulations applicable to the properties;11-

Summary of Financial Results for Fiscal Period
Ended June 30, 2018
(2nd Fiscal Period: from October 1, 2017 to June 30, 2018)

Balance Sheet
Statement of Income and Retained Earnings
Statement of Changes in Net Assets
Statement of Cash Flows
Notes to Financial Statements

F-1

1【Financial Statement】(1) Balance Sheet（Unit：thousand yen）
1ｓｔ

Period2（September 30, 2017）nd

Period（June 30, 2018）

AssetsCurrent Assets
Cash and bank deposit
Operating accounts receivable
Prepaid expenses

89,6372,031,379-

318,430717

44,262-

2,109,820

Deferred tax assets-

27

Other current assets

64—

Total current assets

90,4194,503,919-

517,918

Accumulated depreciation-(13,928)

Structures, net-

503,989

Consumption taxes receivable

Fixed Assets
Property and equipment
Structures

Machinery and equipment-

26,507,191

Accumulated depreciation-(716,996)

Machinery and equipment ,net-

25,790,195

Tools, furniture and fixtures-

462,505

Accumulated depreciation-(12,285)

Tools, furniture and fixtures, net
Land-450,219-

3,876,554

Construction in progress

756

1,944

Total property and equipment

756

30,622,903-

489,601

Intangible assets
Leasehold rights
Software-3,120

Total intangible assets-

492,721

Investments and other assets
Guarantee deposits
Long-term prepaid expenses
Total investment and other assets
Total fixed assets
Total assets

10,00021,021-200,702

10,000221,723

10,756

31,337,349

101,175

35,841,269-

18,216

Liabilities
Current liabilities
Operating Accounts payable
Current portion of long-term loans payable
Accounts payable - otherAccrued expenses
Income taxes payable
Deposits received-

2,883,702

480

42,470-77,898

96

1,465

-

1,331

577

3,025,086

Long-term loan payable-

15,219,585

Total non-current liabilities-

15,219,585

577

18,244,671

150,000

17,315,550

Total current liabilities
Non-current liabilities

Total liabilities
Net assets
Unitholders' equity
Unitholders' capital

F-2

Surplus
Unappropriated retained earnings (Accumulated(49,402)

Total surplus(49,402)

281,047

100,597

17,596,597*1 100,597*1 17,596,597

101,175

35,841,269

deficit)
Total unitholders' equity
Total net assets
Total liabilities and net assets

F-3

281,047

(2)【Statement of Income】(Unit: thousand yen)
1st period

2(from May 18, 2017nd

period(from October 1, 2017

to September 30,

to June 30, 2018)2017)
Operating revenues
Rental revenues of renewable energy power generation*1 -*1 2,023,037-

2,023,037*1 -*1 1,066,206-

30,595Administrative service fees

475

7,350

Director’s compensation

-

3,600

Taxes and duties

3,692

3,596

Other operating expenses

1,138

66,672

facilities, etc.
Total operating revenues
Operating expenses
Rental expenses of renewable energy power generation
facilities, etc.
Asset management fee

Total operating expenses

5,305

1,178,021(5,305)845,015Interest income

012

Total non-operating income

012Operating income or loss
Non-operating incomes

Non-operating expenses
Interest expenses-

94,496

Borrowing-related expenses-

207,160

Organization expenses

40,00013,130Investment unit issuance expenses

4,000

198,350

Total non-operating expenses

44,000513,137

Ordinary income or loss

(49,305)

331,890

Income or loss before income taxes(49,305)

331,890

Income taxes - current

96

1,467

Income tax - deferred

-

(27)

Total income taxes

96

1,440

Net income or loss

(49,402)

330,449-(49,402)(49,402)

281,047

Retained earnings (deficit) brought forward
Unappropriated retained earnings (Accumulated deficit)

F-4

(3)【Statements of Changes in Unitholders’ Equity】
st

1 Fiscal Period (From May 18, 2017 to September 30, 2017)(Unit: thousand yen)
Unitholders’ equity
Unitholders’capitalSurplusCapital surplus

Total surplus

or loss

Total

Total net

unitholders’assetsequityBalance as of May 18, 2017
Changes of items during the period
Issuance of new investment unit

150,000

150,000

150,000(49,402)(49,402)(49,402)(49,402)150,000(49,402)(49,402)100,597

100,597*1 150,000(49,402)(49,402)100,597

100,597

Net loss
Total changes of items during theperiodBalance as of September 30, 2017
2nd

Fiscal Period (From October 1, 2017 to June 30, 2018)(Unit: thousand yen)
Unitholders’ equity
Unitholders’capitalBalance as of October 1, 2017

SurplusCapital surplus

Total surplus

or loss

150,000(49,402)(49,402)

Total

Total net

unitholders’assetsequity100,597

100,597

17,165,550

17,165,550

Changes of items during the period
Issuance of new investment unit

17,165,550

Net Income

330,449

330,449

330,449

330,449

17,165,550

330,449

330,449

17,495,999

17,495,999*1 17,315,550

281,047

281,047

17,596,597

17,596,597

Total changes of items during theperiodBalance as of June 30, 2018(4)【Statements of Cash Distribution】
Fiscal Period under Review

Fiscal Period under Review(From May 18, 2017

(From October 1, 2017

to September 30, 2017)

to June 30, 2018)

Unit: YenI

Unappropriatedretainedearnings

Unit: Yen

(49,402,296)

281,047,367-

147,209,520(Cash distributions per unit)-

428,146,500

Profit distributions(-)(2,350)（Profit distributions per unit）-

280,936,980

Distributions in excess of retained(-)(1,542)

earnings-

147,209,520（Distributions in excess of retained

(-)

(808)

(49,402,296)

110,387(accumulated deficit)
II Distributions in excess of retained
earnings

Deduction from unitholders’ capital
III

Cash distributions

earnings）
IV

Retained earnings (deficit) carriedforwardCalculation method for cash distributions

In accordance with Articles 47,

In accordance with Articles 47,

Paragraph 1 of Canadian Solar

Paragraph 1 of Canadian Solar

Infrastructure Fund, Inc. (“CSIF’) s

Infrastructure Fund, Inc. (“CSIF’) s

F-5

Articles of Incorporation, the amount

Articles of Incorporation, the amountof cash distributions shall be theof cash distributions shall be theamount of profit in excess of anamount of profit in excess of anamount equivalent to 90% of

amount equivalent to 90% of

distributable profits, as stipulated in

distributable profits, as stipulated in

Article 67-15 of the Act on Special

Article 67-15 of the Act on Special

Measures Concerning Taxation.

Measures Concerning Taxation.

Based on this policy, CSIF will not

Based on this policy, CSIF decided tomake distributions in the first fiscal

make distributions of ¥280,936,980

period because there is no amount of which is the entire amount equivalentprofit. In addition, the unappropriated to the unappropriated retained
loss will be carried forward to the next earnings for the fiscal period underperiod. CSIF does not distribute cash review of ¥281,047,367 excluding
distributions in excess of its earnings, fractions of the distribution per unit
as stipulated in Article 47, Paragraph that are less than ¥1.
2 of its Articles of Incorporation.

CSIF distributes cash in excess ofretained earnings every fiscal period
based on the cash distribution policy
prescribed in Article 47, Paragraph 2of CSIF’s Articles of Incorporation.
Based on this policy, CSIF decided tomake cash distributions in excess ofearnings (return of capital categorized
as a distribution of the reduction incapital for Japanese tax purposes) in
the amount of ¥147,209,520 which isequivalent to 19.8% of the amount ofdepreciation expenses recorded forthe fiscal period under review of¥743,653,467.
Accordingly, the distribution per unit is¥2,350.

(Note) Distributions in excess of retained earnings per unit will generally be based on the cash distribution policy
prescribed in CSIF’s Articles of Incorporation and the Asset Manager’s asset management guideline.
CSIF intends to make cash distributions of NCF within the FCF generated from the renewable energy power
generation facilities. The amount available for distribution shall be calculated by multiplying NCF by thepayout ratio.
Further, CSIF intends to make distributions in excess of retained earnings for each fiscal period in order torealize such policy.
CSIF’s forecasts (including revised forecasts) for each fiscal period are based on the assumption of theForecast Power Generation (P50) provided in the independent technical report which is used as a basis forcalculating rents for renewable energy power generation facilities and if actual NCF calculated based on
actual power generation during the applicable fiscal period exceeds forecast NCF, CSIF’s policy is to set“forecast NCF multiplied by the payout ratio” as the upper limit of the amount of cash distributions for theapplicable fiscal period.
.
On the other hand, if actual NCF is less than forecast NCF, CSIF’s policy is to set “actual NCF multiplied by
the payout ratio” as the amount of cash distributions for the applicable fiscal period.
Based on this policy, CSIF decided to make distributions for the current fiscal period of ¥428,146,500 whichis equivalent to 45.9% of forecast NCF amount for the fiscal period under review of ¥932,781,045. Of this,¥147,209,520 which is the amount less of distributions of profit of ¥280,936,980 is distributions in excess ofretained earnings.

F-6

(5)【Statement of Cash Flow】(Unit: thousand yen)
1st period

Cash flows from operating activities
Income (Loss) before income taxes
Depreciation cost
Investment unit issuance expenses
Organization expenses
Interest income
Interest expenses
Decrease (Increase) in operating accounts receivable
Decrease (Increase) in consumption taxes receivable
Decrease (Increase) in prepaid expenses
Decrease (Increase) in long-term prepaid expenses
Increase (Decrease) in operating accounts payable
Increase (Decrease) in accounts payable - other
Increase (Decrease) in accrued expenses
Other, net
Sub-totalInterest received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchases of property and equipment
Purchases of intangible fixed assets
Payment for guarantee deposit
Payments for organization expenses
Net cash provided by (used in) investing activities
Cash flows from financing activities
Proceeds from long-term loans payable
Repayment of long-term loans payable
Proceeds from issuance of investment units
Payments for investment unit issuance expenses
Net cash provided by (used in) financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the fiscal period
Cash and cash equivalents at the end of the fiscal period(6)【Notes to Financial Statements】[NOTES ON GOING CONCERN PREMISE]
Not applicable.

F-7

2

nd

period(from May 18, 2017(from October 1, 2017

to September 30, 2017)

to June 30, 2018)(49,305)
4,000
40,000
(0)
(717)
480
(64)
(5,607)0(5,606)331,890743,653
198,350
13,130(12)
94,496(318,430)(2,109,820)(43,544)(200,702)
18,216
41,98977,131
1,395(1,152,256)12(93,728)(98)(1,246,071)(756)(10,000)(40,000)(50,756)(31,365,358)(493,165)(11,021)(13,130)(31,882,674)

150,000(4,000)146,000
89,637*1 89,637

18,640,000(536,711)
17,165,550(198,350)
35,070,488
1,941,741
89,637*1 2,031,379

[SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES]
1.Method of depreciation and amortization of non-current(1) Property and equipment

assets

The straight-line method is adopted. In addition, theuseful lives of major property and equipment are asshown below:
Structures .................................... 22 - 25 years
Machinery and equipment ........... 22 - 25 years
Tools, furniture and fixtures ......... 22 - 25 years(2) Intangible assets
The straight-line method is adopted. In addition, theuseful life is as shown below:
Software ...................................... 5 years(3) Long-term prepaid expenses
The straight-line method is adopted.

2.Standards for revenue and expense recognition

Accounting for fixed assets tax
With respect to fixed assets tax, city planning tax anddepreciable assets tax, among other taxes, on theinfrastructure assets held, of the tax amount assessed anddetermined, the amount corresponding to the calculation
period is accounted as rental expenses. In addition,
reimbursement such as fixed assets tax, which is paid tothe seller and other persons on the acquisition of
infrastructure assets and other assets (“the amountequivalent to the fixed assets taxes and other taxes”) is notrecognized as rental expenses but included in theacquisition cost of the concerned infrastructure assets andother assets. In the fiscal period under review, the amountequivalent to the fixed assets tax and other taxes includedin the acquisition cost of infrastructure assets and otherassets is 10,811 thousand yen.

3.Scope of funds in statement of cash flows

Funds (cash and cash equivalents) in statement of cash
flows consist of cash on hand, demand deposits andshort-term investments with a maturity of three months orless at the date of acquisition that can readily be converted
into cash and that are subject to insignificant risks ofchanges in value.

4.Method of hedge accounting(1) Method of hedge accounting
Special treatment is adopted for the interest rate swap
that meets the requirements for special treatment.
(2) Hedging instruments and hedged items:･

Hedging

instruments……Interest

rate

swap

transaction･Hedged items….Interest rate on loans(3) Policy for hedging
CSIF conducts derivative transactions to hedge risks as
set forth in the CSIF’s Articles of Incorporationaccording to the rules for risk management.
(4) Method of evaluation of effectiveness of hedging
The interest rate swap meets the requirements for
specialtreatment,

andeffectiveness is omitted.

F-8

thus

the

evaluationof5.Other significant matters serving as the basis for

Accounting for Consumption tax

preparation of financial statements

Consumption tax and local consumption tax are excluded
from the corresponding transaction amount.

［NOTES ON UNAPPLIED ACCOUNTING STANDARDS］(Unapplied Accounting Standards）
・Accounting Standard for Revenue Recognition (ASBJ Statement No. 29 published on March 30, 2018 by the
Accounting Standards Board of Japan)
・Implementation Guidance on Accounting Standard for Revenue Recognition (ASBJ Guidance No. 30 published on
March 30, 2018 by the Accounting Standards Board of Japan）
1.Overview
The International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) havejointly developed a converged accounting standard on revenue recognition and issued “Revenue from Contracts
with Customers” (IFRS 15 by IASB and Topic 606 by FASB) in May 2014. IFRS 15 is effective for annual reporting
periods beginning on or after January 1, 2018 and Topic 606 is effective for annual reporting periods beginning on orafter December 15, 2017. In this connection, the ASBJ developed a converged accounting standard on revenue
recognition and issued the standard together with its implementation guidance.
The ASBJ followed two policies in developing accounting standard for revenue recognition. That is, to incorporate
all basic IFRS 15 requirements to ensure comparability of financial statements, but also to consider additional
alternative treatments based on practices applied by Japanese companies so that the standards would not
significantly impair comparability.
2.Planned date of application
CSIF will apply the standard at the beginning of the fiscal period ending December 2021.
3.Effect of application of the standard
The effect that the application of Accounting Standard for Revenue Recognition will have on the financial
statements is currently under evaluation.

[NOTES TO BALANCE SHEET]*1 Minimum net assets stipulated in Article 67, Paragraph 4 of the Act on Investment Trusts and Investment
Corporations(Unit: thousand yen)
As of September 30, 2017

As of June 30, 2018

50,00050,000F-9

[NOTES TO STATEMENT OF INCOME ]*1 Breakdown of profits and losses from the rental business of renewable energy power generation facilities, etc.
(Unit: thousand yen)
From May 18, 2017 to

From October 1, 2017 to

September 30, 2017

June 30, 2018

1.Operating revenue from the rental business of renewable energy power generation facilities, etc.
Rental revenue of renewable energy power generation facilities, etc.
(Basic rent)(Variable rent linked to actual output )(Incidental income)
Total operating revenue from the rental business of renewable energy
power generation facilities, etc.

-

1,370,356-

2,023,037

652,674
6

2.Operating expenses from the rental business of renewable energy power generation facilities, etc.
Rental expenses of renewable energy power generation facilities, etc.
(Management entrustment expenses)-

133,827(Repair and maintenance costs)--(Taxes and duties )-154,281(Utilities expenses)--(Insurance expenses)-

11,632(Depreciation expenses)-

743,210(Land rent )-23,253(Other rental cost)--

Total operating expenses from the rental business of renewable energy
power generation facilities, etc.

-

1,066,206

3.Profits and losses from the rental business of renewable energy power generation facilities, etc.
-

956,830[NOTES TO STATEMENT OF CHANGES IN NET ASSETS]*1 Total number of authorized investment units and the total number of investment units issued and outstanding

Total number of authorized investment units
Total number of investment units issued and outstanding

From May 18, 2017

From October 1, 2017

to September 30, 2017

to June 30, 2018

10,000,000 units

10,000,000 units

1,500 units

182,190 units[NOTES TO STATEMENT OF CASH FLOWS]*1 Relationship between the ending balance of cash and cash equivalents and the amounts on the balance sheet(Unit: thousand yen)
From May 18, 2017

From October 1, 2017

to September 30, 2017

to June 30, 2018

Cash and deposits

89,6372,031,379

Cash and cash equivalents

89,6372,031,379[NOTES ON LEASE TRANSACTIONS]
Operating lease (as the lessor)
Future minimum lease payments(Unit: thousand yen)

Fiscal period ended
September 30, 2017

Fiscal period ended
June 30, 2018

Within one year-

2,176,829

Longer than one year-

36,039,821

Total

-

38,216,650

F-10

[NOTES ON FINANCIAL INSTRUMENTS]
1.Situation of financial instruments(1) Policy for financial instruments
CSIF procures funds for acquiring new assets or repaying loans through loans from financial institutions or
issuing investment units. The basic policy is to build stable and sound financial operations to maintain andincrease earnings in the medium to long term and grow the size and value of assets.
(2) Details of the financial instruments and their risks and the risk management system
Long-term loans payables are one of the means to procure the funds for the acquisition of managed assets
and are exposed to interest rate fluctuation risk and liquidity risk, among other risks. However, this risk isdeducted through the appropriate balancing of the loan period and the interest rate type, and diversification oflenders, and the appropriate management of various types of indexes, especially the general application of theupper limit of the ratio of interest-bearing, which is 60%.
(3) Supplementary explanation on fair value of financial instruments
The fair values of financial instruments are values based on market prices, or if there are no market prices,values are reasonably calculated. Since certain assumptions are used for the calculation of fair values, they may
change if different assumptions are used.

2.Matters relating to fair values of financial instruments
The table below shows the book value and fair values of financial instruments as of September 30, 2017, and thedifference between them. Financial instruments whose fair values are extremely difficult to estimate are notincluded in the table.
(Unit: thousand yen)Book value

Fair value

Difference(1) Cash and deposits

89,637

89,637-

Total assets

89,637

89,637-(2) Accounts payable

480

480

-

Total liabilities
480
480(Note 1) Methods used for estimating the fair values of financial instruments
Assets(1) Cash and deposits. These financial instruments are settled in the short term, and their fair values are deemed
to approximate their book value. Therefore, the book values are used as the values.
Liabilities(2) Accounts payable. These financial instruments are settled in the short term, and their fair values are deemed
to approximate their book value. Therefore, the book values are used as the values.
The table below shows the book value and fair values of financial instruments as of June 30, 2018, andthe difference between them. Financial instruments whose fair values are extremely difficult to estimate
are not included in the table.
(Unit: thousand yen)Book value(1) Cash and deposits

2,031,379(2) Operating accounts receivable
Total assets

Fair value
2,031,379

Difference-

318,430

318,430-

2,349,809

2,349,809-(3) Current portion of long-term loans payable

2,883,702

2,882,035(1,667)(4) Long-term loans payable

15,219,585

15,358,035

138,450

18,103,288

18,240,071

136,783

Total liabilities(5) Derivative transaction(Note 1) Methods used for estimating the fair values of financial instruments and matters related to derivativetransactions
Assets(1) Cash and deposit(2) Operating accounts receivable
These financial instruments are settled in the short term, and their fair values are deemed to approximate theirbook value. Therefore, the book values are used as the values.
Liabilities

F-11(3) Current portion of long-term loans payable(4) Long-term loans payable
With respect to long-term loans payable at variable interest rates, the condition that the interest rates are renewed
every certain period is applied to loans, and thus the market value is considered to be close to the book value.
Accordingly, the book value is used. In addition, for the long-term loans payable at variable interest rates
subject to the special treatment of interest rate swap (refer to the “Notes on derivative transactions” below), thefair value is measured by discounting the total sum of the principal and interest treated together with the saidinterest rate swap as one at the interest rate that is applied when the similar loan is obtained and that isreasonably estimated.
(5) Derivative transaction
Please refer to the “Notes on derivative transactions” below.
(Note 2) Scheduled redemption amounts of monetary receivables after the closing date (September 30, 2017)
Longer than
one year,within two
years
89,637-

Within one
year(1) Cash and deposits
Total

89,637Longer than
two years,
within three
years
-

-

Longer than
three years,
within four
years
-

-

-

(Unit: thousand yen)
Longer thanfour years,
Longer than
within five
five years
years
-

-

Scheduled redemption amounts of monetary receivables after the closing date (June 30, 2018)(1) Cash and deposits(2) Operating accounts
receivable
Total

Longer thanWithin one
one year,year
within two
years
2,031,379-

Longer than
two years,
within threeyears-

Longer than
three years,
within four
years-

(Unit: thousand yen)
Longer thanfour years, Longer than
within five
five years
years-

318,430

-

-

-

-

-

2,349,809

-

-

-

-

-

(Note 3) Scheduled redemption amount of loans payables after the closing date

(September 30, 2017)

Not applicable.
Scheduled redemption amount of loans payables after the closing dateWithin one
year(3) Current portion of
long-term loans payable(4) Long-term loans payable
Total

Longer than
one year,within two
years

2,883,702
2,883,702

Longer than
two years,
within three
years
-

-

(June 30, 2018)

Longer than
three years,
within four
years

(Unit: thousand yen)
Longer thanfour years, Longer than
within five
five years
years

-

-

-

845,487

1,600,846

838,811855,747

11,078,692

845,487

1,600,846

838,811855,747

11,078,692[NOTES ON SECURITIES]
Prior fiscal period (as of September 30, 2017)
Not applicable.
Current fiscal period (as of June 30, 2018)
Not applicable.

F-12

[NOTES ON DERIVATIVE TRANSACTIONS]
1.Those to which hedge accounting is not applied
Prior fiscal period (as of September 30, 2017)
Not applicable.
Current fiscal period (as of June 30, 2018)
Not applicable.
2.Those to which hedge accounting is applied
Prior fiscal period (as of September 30, 2017)
Not applicable
Current fiscal period (as of June 30, 2018)(Unit: thousand yen)
Method ofType of derivativehedge
transactions and othermatters
accounting

Major items
hedgedContract amount and otheramounts

Fair value

Longer than
one year

Method ofcalculation ofsaid market
valueInterest rate swap
transaction
Long-term
Fixed
loans
15,195,201
14,399,405(Note)
payment/variablepayablereceipt(Note) Those that are subject to special treatment of interest rate swap are treated together with the current portionof long-term loans payable and the long-term loans payable to be hedged as one, and thus their fair value ispresented together with the fair value of (Note 1) (3) Current portion of long-term loans payable and (4)Long-term loans payable in “Notes on financial instruments 2.Matters relating to fair values of financial
instruments, among other matters” .

Specialtreatmentof interest
rate swap[NOTES ON RETIREMENT BENEFITS]
Prior fiscal period (as of September 30, 2017)
Not applicable.
Current fiscal period (as of June 30, 2018)
Not applicable.
[NOTES ON TAX EFFECT ACCOUNTING]
Prior fiscal period (as of September 30, 2017)
Not applicable.
Current fiscal period (as of June 30, 2018)(1) Breakdown of deferred tax assets and deferred tax liabilities by major cause(Unit: thousand yen)

Fiscal period ended
September 30, 2017

Fiscal period ended
June 30, 2018

Accrued business tax not deductible from taxable
income-27

Total deferred tax assets-

27

Net amount of deferred tax assets

-

27

F-13

(2) Breakdown of each major item that causes a significant difference between the effective statutory tax rate and therate of the burden of corporate tax and other taxes after the application of tax effect accounting
Fiscal period ended
Fiscal period ended
September 30, 2017
June 30, 2018
- (Note)Effective statutory tax rate
(Adjustment)
Dividends paid deductible for tax purpose
Loss carried forward and deducted for the period
OthersRate of burden of corporate tax and other taxes after
the application of tax effect accounting

31.74%- (Note)- (Note)- (Note)(26.87)%(4.72)%
0.28%- (Note)

0.43%（Note）Omitted because CSIF recorded a loss before tax.

[NOTES ON SHARE OF PROFIT (LOSS) OF ENTITIES ACCOUNTED FOR USING EQUITY METHOD, ETC.]
Prior fiscal period (as of September 30, 2017)
Not applicable.
Current fiscal period (as of June 30, 2018)
Not applicable.
[NOTES ON RELATED PARTY TRANSACTIONS]
1.Major corporate unitholders
Prior fiscal period (from May 18,2017 to September 30, 2017)
Attributes

Name ofcompany

Address

Capital or
Relationship
Unitholding
investment Business or
ratio(thousand occupation
Interlocking
Business(owned)yen)
officers relationshipTransactions

Amount oftransactions(thousand
yen)

Item

Installation,
operationand50F
mainteShinjuku
nanceMitsui
Canadianbusiness of
Acceptance
Total
Building,
Controlling
Solar
Controlling
amount of
100,000 equipment
100.0%
Noneof
150,000
unitholder
Projects 2-1-1 Nishi
unitholder
investmentforinvestment
K.K.
Shinjuku,
photovoltaic
Shinjuku-ku
power, Tokyogenerationand other
new energy(Note 1) Of the amounts described above, the transaction amount does not include consumption taxes and other taxes.
(Note 2) With respect to the transaction conditions, the market price and other conditions are referred to in the decision.

Current fiscal period (from October 1,2017 to June 30, 2018)
Not applicable.
2.Affiliates
Prior fiscal period (from May 18,2017 to September 30, 2017)
Not applicable.
Current fiscal period (from October 1,2017 to June 30, 2018)
Not applicable.

F-14

Endingbalance(thousandyen)

150,000

3.Fellow Subsidiaries
Prior fiscal period (from May 18,2017 to September 30, 2017)
Attributes

Name ofcompany

Address

Capital or
Relationship
Unitholding
investment Business or
ratio(thousand occupation(owned) Interlocking Businessyen)
officers relationship

33F
Shinjuku
CenterSubsidiary CanadianofSolar Asset Building,controlling Manage- 1-25-1 Nishi
unitholder ment K.K. Shinjuku,
Shinjuku-ku, Tokyo

150,000

Investment
managementbusiness-

There areinterlocking
officers

Transactions

Delegation Payment ofof asset
remunemanageration for
ment
organizer

Amount oftransactions(thousand
yen)

Item

Endingbalance(thousandyen)

40,000--Current fiscal period (from October 1,2017 to June 30, 2018)
Not applicable.
4.Officers and major individual unitholders
Prior fiscal period (from May 18,2017 to September 30, 2017)
Not applicable.
Current fiscal period (from October 1,2017 to June 30, 2018)
Not applicable.
[NOTES ON ASSET RETIREMENT OBLIGATIONS]
Prior fiscal period (from May 18,2017 to September 30, 2017)
Not applicable.
Current fiscal period (from October 1,2017 to June 30, 2018)
Not applicable.

[NOTES ON INVESTMENT AND RENTAL PROPERTY]CSIF has renewable energy power generation facilities, etc. . The book value , change during the period and fairvalue at the end of the period are as shown below.
(Unit: thousand yen)
Fiscal period ended
September 30, 2017

Fiscal period ended
June 30, 2018

Book value (Note 2)
Beginning balance-

Change during the period (Note 3)-

31,110,561

Ending balance-

31,110,561-

35,963,000

Fair value at the end of the period(Note 4)-(Note 1) The real estate that CSIF holds is real estate to be provided for the use of renewable energy power generation facilities,
and thus with respect to the book value and the fair value, the amount of the renewable energy power generation
facilities and real estate are stated together as one.
(Note 2) The book value is the amount at acquisition cost less the accumulated depreciation.
(Note 3) The change during the period primarily consisted of the increase due to acquisition of fifteen photovoltaic power
generation facilities (31,853,772 thousand yen), and the decrease due to depreciation expenses (743,210 thousandyen).
(Note 4) The fair value is the total sum of the intermediate values according to Article 41, paragraph 1 of the CSIF's Articles ofIncorporation on the basis of the appraised value in the range stated in the valuation report with the date of the value
opinion on June 30, 2018, which was obtained from PricewaterhouseCoopers Sustainability LLC.

In addition, profits and losses from the renewable energy power generation facilities, etc. for the fiscal period ended
September 30, 2017 (the 1st period) and the fiscal period ended June 30, 2018 (the 2nd period) are as stated in the“Notes to statement of income” above.
[NOTES ON SEGMENT INFORMATION]
1.Segment information
Since CSIF has a single segment of the rental business of infrastructure assets, the segment information isomitted.

F-15

2.Related Information
Prior fiscal period (from May 18,2017 to September 30, 2017)(1) Information on products and services
Information is omitted because operating revenue is not generated.
(2) Information on regions① Operating revenue
Information is omitted because operating revenue is not generated.
② Property and equipment
Information is omitted because the Investment Corporation does not hold property, plant and equipment.
(3) Information on major customers
Information is omitted because operating revenue is not generated.
Current fiscal period (from October 1,2017 to June 30, 2018)(1) Information on products and services
Information is omitted because operating revenue from a single product/service to outside customers
exceeds 90% of the operating revenue on the statement of income.
(2) Information on regions① Operating revenue
Information is omitted because operating revenue from outside customers in Japan exceeds 90% of theoperating revenue on the statement of income.
② Property and equipment
Information is omitted because the amount of property and equipment located in Japan exceeds 90% of
the amount of property and equipment on the balance sheet.
(3) Information on major customers(Unit: thousand yen)
Name of customer

Total net revenue

Name of related segment

1,976,071

Renewable energy power generation
facilities, etc. rental business

CLEAN GUADALQUIVIR K.K.

11,895

Renewable energy power generation
facilities, etc. rental business

Univergy 12 G.K.

35,064

Renewable energy power generation
facilities, etc. rental businessTida Power 01 G.K.

[NOTES ON PER UNIT INFORMATION]

Net assets per unit
Net income (Net loss) per unit

Prior fiscal period
From May 18,2017
to September 30, 201767,065 yen(32,934) yen

Current fiscal period
From October 1,
June 30, 2018
96,583 yen
2,007 yen

(Note 1) Net income (Net loss) per unit is calculated by dividing net income (net loss) by the average number of investment units
during the period. In the previous fiscal period, a loss was posted and there were no dilutive investment units, and thus
diluted loss per unit is not stated. With respect to diluted profit per unit for the period under review, there are no dilutive
investment units, and thus the statement is omitted.
(Note 2) The basis of calculation of net income (net loss) per unit is as follows.

Prior fiscal period
From May 18,2017
to September 30, 2017
Net income (Net loss) (Thousand yen)Amount not attributable to common unit
holders (Thousand yen)
Net income (Net loss) attributable to
Common unit holders (Thousand yen)
Average number of investment units during
the period (Units)

F-16

Current fiscal period
From October 1,2017
June 30, 2018(49,402)

330,449--(49,402)

330,449

1,500

164,642[NOTES ON SIGNIFICANT SUBSEQUENT EVENTS]
1.Issuance of new investment units
CSIF passed a resolution on the issuance of new investment units (hereinafter referred to as the “Offering”) at themeeting of the board of directors held on August 14, 2018, and August 29,2018 as shown below. Payment for theissuance of new investment units through public offering was completed on September 5,2018.
(i) Issuance of new investment units through public offering
Number of new investment units issued
46,667 units
26,697 units for the Japanese public offering
19,700 units for the international offering
Issue Price (Offer Price)
102,180 yen per unit
Total Issue Price (Total Offer Price)
4,768,434,060 yen
Amount to be paid in (Issue amount)
96,625 yen per unit
Total amount to be paid in (Total Issue amount) 4,509,198,875 yen
Payment date
September 5, 2018
Purpose of funding
The funds from the primary offering were allocated to part of
the funds for acquisitions of specific assets (as defined in
Article 2, paragraph 1 of the Act on Investment Trust andinvestment Corporation ; the same shall apply hereinafter.)(ii) Issuance of new investment units through third-party allotment
Number of new investment units issued (upper limit) 2,333 units
Amount to be paid in (Issue amount)
96,625 yen per unit
Total amount to be paid in (Total Issue amount)
225,426,125 yen
Allottee and number of investment units allotted(upper limit)
Mizuho Securities 2,333 units
Payment date
September 5, 2018
Purpose of funding
The funds through third party allotment are the fundon hand by depositing with financial institutions until
payment and are scheduled to be allocated to partof the funds for future acquisitions or repayment ofborrowings.
2.Borrowings of the Funds
CSIF decided to borrow funds for the purpose of the appropriation of the funds obtained as set forth in “3.
Acquisition of assets” below at the meeting of the board of directors held on August 14,2018 and plans to borrowthe funds described below on September 6,2018.
CSIF completed the borrowing of funds, as described below, on September 6, 2018. The borrowed funds wereapplied to partial fund for acquisition of the newly acquired assets described in “3. Acquisition of assets” below and
expenses related thereto (including consumption taxes).
Borrowing
Interest
Repayment
Drawdown
Security
Type
AmountRate
Repayment date
MethodLenders(Note 4)
Date
(Note 1)(million yen) (Note 2)(Note 3)Longterm

Longterm

Shinsei Bank, Limited(arranger)
Sumitomo Mitsui Banking
Corporation (arranger)
MUFG Bank, Ltd.
(co-arranger)
The Nanto Bank, Ltd.
Shinsei Bank, Limited(arranger)
Sumitomo Mitsui Banking
Corporation (arranger)
MUFG Bank, Ltd.
(co-arranger)

8,000(Note 5)

Base rate
Corresponding
PartialUnsecured,plus 0.45% September date in ten years
installment(Note 6)
6, 2018
unguaranteedfrom the(Note 5)(Note 7)
drawdown date

850
(Note 8)The earlier date of(i)June30,2020 orBase rate(ii) the first
SeptemberLump-sum Unsecured,plus 0.20%
interest payment
payment unguaranteed
6, 2018(Note 9)date on or after
the consumption
taxes refund date

(Note 1) Long-term refers to borrowings that have a period of over a year from the drawdown date to the repayment date.
(Note 2) Finance related costs paid to the lenders are not included.
(Note 3) CSIF can make an early repayment of all or part of our borrowings subject to certain conditions, such as prior written notice to the relevant lenders.
(Note 4) The loan agreements contain restrictive financial covenants to be applied on each settlement date of CSIF, such as the total
amount of interest-bearing liabilities to the total asset value (LTV), debt-to equity ratio and debt service coverage ratios as
indicators to determine the ability of CSIF to repay the loan. Breaches of such covenants for 2 successive fiscal periods or an
occurrence of an acceleration event could result in being required to grant security interests in favor of the lenders.
(Note 5) CSIF intends to enter into balloon amortization loans, which has an initial principal repayment date of December 31, 2018, andsubsequent principal repayment dates shall be the last day of June and December (if a principal repayment date is not a businessday, then the payment shall be made on the immediately succeeding business day; provided, however, that if such payment day
falls into the following month, then the payment shall be made on the immediately preceding business day) and the remaining
principal shall be repaid as a balloon payment on the repayment date. Principal repaid as a percentage of the outstanding balance as at
December 31, 2018 will be 2.418%.
(Note 6) The applicable base rate for each interest calculation period (being 6 months, excluding the first and last interest period) for the
calculation of the interest payable on the interest payment date shall be the 6 month Japanese yen TIBOR (Tokyo Interbank
Offered Rate) announced by the General Incorporated Association JBA (Japanese Bankers Association) TIBOR Administration on
the 2nd business day prior to the Drawdown Date for the first interest calculation period and on the 2nd business day prior to thebeginning of each relevant interest calculation period thereafter. The applicable base rate shall be revised for each interest period.

F-17

However, if a corresponding base rate is not available for an interest calculation period, the base rate shall be calculated using themethod agreed in the relevant loan agreement.
(Note 7) The interest rate for the full amount of the Term Loan shall be effectively fixed at 1.042% with the execution of the interest rate swap
agreements(Note 8) CSIF stated payment of consumption tax as the use of the funds borrowed and plans to use any refund of consumption tax to repay
the funds borrowed.
(Note 9) The applicable base rate for each interest calculation period (being 1 month, excluding the first and last interest period) for the
calculation of the interest payable on the interest payment date shall be the 6 month Japanese yen TIBOR (Tokyo Interbank
Offered Rate) announced by the General Incorporated Association JBA (Japanese Bankers Association) TIBOR Administration on
the 2nd business day prior to the Drawdown Date for the first interest calculation period and on the 2nd business day prior to thebeginning of each relevant interest calculation period thereafter. The applicable base rate shall be revised for each interest period.
However, if a corresponding base rate is not available for an interest calculation period, the base rate shall be calculated using themethod agreed in the relevant loan agreement.

3. Acquisition of assets
The Investment Corporation decided to acquire the following assets with the funds of “2. Borrowings of the Funds”
above according to the basic policy for asset management set forth in the Articles of Incorporation at the meeting of
the board of directors held on August 14,2018 and plans to acquire the said assets on September 6,2018.
CSIF completed the acquisition of assets, as described below, on September 6, 2018.
Acquisition
Asset
Price
Project nameLocation
numberAcquired from(million yen)
(Note 2)
(Note 3)(Note 1)
(Note 4)
S-16

CS Ena-shi Power Plant

S-17

CS Daisen-cho Power Plant (A)Saihaku-gun, Tottoriand (B)

Ena-shi, Gifu

757 Univergy 23 G.K.

S-18

CS Takayama-shi Power Plant

Takayama-shi, Gifu

Total

10,447 CLEAN ENERGIES XXI G.K.
326 Univergy 10 G.K.
11,530-(Note 1) Asset number is the number that we have assigned to our projects, based on the classification of the renewable energy project.
The S denotes a solar energy project. The same applies herein.
(Note 2) “CS” is the abbreviation for Canadian Solar. The same applies herein.
(Note 3) Based on the location of the land or one of the lands upon which the photovoltaic power generation is installed, as described in theproperty registry. In either case, the address is described up to the city or district.
(Note 4) With respect to CS Ena-shi Power Plant, on the acquisition date, surface right was established for CSIF to hold photovoltaic power
generation facilities and to engage in business related thereto by CS Mie Yamada G.K., the surface right establisher. The
anticipated acquisition price for CS Ena-shi Power Plant includes a lump-sum fee in the amount of ¥44,844,848 to be paid to CS
Mie Yamada G.K. for the surface rights, which covers the duration of the term of the surface rights until September 30, 2042.

(7)【Supplementary Schedules】
1. Schedule of Securities
Not applicable.
2. Status of Contract Amounts, etc. and Estimated Fair Value of Derivative Transactions and Forward Exchange
Transactions(Unit: thousand yen)
Category

Contract amount, etc. (Note 1)

Type

Longer than one year

Fair value(Note 2)OTC
Interest rate swap transactions(over-the-counter)pay-fixed, receive-variable

15,195,201

14,399,405

-

Total

15,195,201

14,399,405-(Note 1) The contract amount, etc. of interest rate swap transactions is based upon Notional principal amount.
(Note 2) Fair value is omitted because the transaction meets the requirement for special treatment based on the
Accounting Standard for Financial Statements

3. Schedule of Assets Related to Real Estate
Not applicable.

F-18

4. Schedule of Assets Related to Renewable Energy Power Generation Facilities(Unit: million yen)

Asset TypeBalance
Increase Decrease Balance
as ofduring the during the as of June
October 1,
periodperiod30, 2018
2017

Accumulated
depreciation or
accumulated
amortization

Net balance
as of June Remarks
Depreciation 30, 2018
during theperiodStructures

-

517

-

517

13

13

503

(Note)

Machineryandequipment-

26,507-26,507716

716

25,790(Note)

-

462

-

462

12

12

450

(Note)(Note)

Property Tools,
furniture andandequipment fixtures
Land

-

3,876

-

3,876

-

-

3,876

Constructionin progress

0

1

-

1

-

-

1

Total

0

31,366-

31,366743

743

30,622

-

489

-

489

-

-

489

-

3

-

3

0

0

3

-

493

-

493

0

0

492

LeaseholdIntangible rights
assets Software
Total(Note)(Note) The “Increase during the Period” is entirely due to the acquisition of Photovoltaic power generation facilities (October 31, 2017 andFebruary 1, 2018).

5. Schedule of Other Specified Assets
Not applicable.
6. Schedule of Investment Corporation Bonds
Not applicable.

F-19

7. Schedule of Loans Payable

Category

LenderBalance Increase Decrease Balance
as ofduringduringas of
Average
OctoberthetheJune 30, interest
1, 2017
periodperiod2018
rate (%)(million (million (million (million (Note 1)
yen)
yen)
yen)
yen)

Shinsei Bank,
Limited

-

2,400

77

2,322

Mizuho Bank,
Ltd.

-

1,500

48

1,451

Sumitomo
Mitsui
Banking
Corporation

-

1,500

48

1,451

MUFG Bank,
Ltd.

-

1,000

32

967

Resona Bank,
Limited

-

1,800

57

1,742

ORIX Bank
Corporation

-

1,000

32

967

The
Hiroshima
Bank, Ltd.

-

1,800

57

1,742

The Nanto
Bank, Ltd.

-

1,800

57

1,742

-

900

28

871

-

900

28

871

THE MIE
BANK, LTD.

-

200

6

193

THE
TOCHIGI
BANK, LTD.

-

900

28

871

Shinsei Bank,
Limited

-

1,040

-

1,040

Mizuho Bank,
Ltd.

-

500

-

Sumitomo
Mitsui
Banking
Corporation

-

500

-

Long
The Oita-term
Bank, Ltd.
loans
payable THE SHONAIBANK, LTD.

Sumitomo
Mitsui
Banking
Corporation

-

900

31

Total

-

18,640536

0.84500(Note 2)

Repayment
date

Repayment method

Use

Remarks

Repaymen
October 31, t in partial (Note Unsecured
2027
installment 4) Unguaranteeds

The earlier
date of(i)June30,201
500
9 or (ii)the first
Lump-suminterest(Note Unsecured
0.29945
repayment
payment date3) Unguaranteed
at maturity
on or after the500
consumption
tax refund
date
868 0.57636

18,103February 1,
2021

-

-

Repayment in partial (Note Unsecured
installment 4) Unguaranteed
s
-

-

-

(Note 1) The average interest rate is the weighted-average figure during the period and is rounded to the sixth decimal place.
(Note 2) CSIF conducts interest rate swaps which fix interest rates to hedge interest rate risk, and the average interest rate is theweighted-average figure during the period taking the effect of interest rate swaps into consideration.
(Note 3) CSIF plans to use any refund of consumption tax paid in connection with the acquisition of acquired assets to repay the funds borrowed.
(Note 4) Funds are used mainly for acquisition of renewable energy power generation facilities .
(Note 5) Scheduled redemption amounts of long-term loans payable within five years after the date of the balance sheet are as follows.

(Unit: thousand yen)
Within one
year
Long-term loans
payable2,883,702

Longer than
one yearwithin two
years

Longer than
two years
within threeyears

Longer than
three years
within fouryears

Longer thanfour years
within fiveyears

Longer than fiveyears

845,487

1,600,846

838,811855,747

11,078,692

F-20